## The Methodology Behind “Average” Rate of Return

When someone quotes the rate of return on a specific investment or quotes average returns on an index to support a theory behind achieving similar results in their investment, do you actually know what exactly they are talking about?  Further more, what is the probability that you will in fact end up with what everyone else is quoting as “average?”  The old joking definition of Statistics is: generally everyone; specifically no one.  And this seems to be  pretty fitting for a novice skill level in probability and statistics.  However, once we get a little more technical, and employ a few more mathematical techniques, we start to explore what purpose these numbers really serve.  We'll explore some useful applications of these figures in this post.

## Looking for some Good Ideas for your Emergency Fund? Part 3 Reasons 6, 7, and 8

Here we are, the conclusive post to the Emergency Fund trilogy (sounds special).  Again, if you'd like a refresher on all 8 reasons from the original post they are:

1. Increased rate of return
2. Tax deferral
3. Potentially tax free withdrawal
4. Death benefit
5. Private and non-probate asset
6. Fewer fees (in most cases)
7. Recaptured opportunity
8. Systematic savings

## Looking for some Good Ideas for your Emergency Fund: Part 2 Reasons 1-5

So last time we dove into general design, and this time around we'll be addressing why this is such a great idea.  I left off the last post with 8 reasons for using cash value life insurance as a spot to store emergency fund cash.  If you forgot here they are:

1. Increased rate of return
2. Tax deferral
3. Potentially tax free withdrawal
4. Death benefit
5. Private and non-probate asset
6. Fewer fees (in most cases)
7.  Recaptured opportunity
8. Systematic savings

## Looking for some Good Ideas for your Emergency Fund? Part 1: Cash Value Life Insurance?

In the spirit of the Holiday Season, which just wound down for the most part (hurray I can drive by major commercial locations again!), I figured I'd make today's piece a sort of “holiday gift ideas with cash value life insurance that kick ass” type post.  For years I've been advocating what I'm about to roll out here, and I've got clients who have accomplished some seriously nice cash positions that are crushing what others are traditionally taught to do with their emergency fund money on a rate of return playing field.

## An Oldie, but Goodie

I remember quite vividly the first time I saw this video.  I was still a career agent with one of the big 4 Mutuals and we had a special meeting conducted by the Director of Individual Life Sales.  He came from the Home Office to give us a presentation on the topic of life insurance as an asset class and brought with him this video recorded a few months prior on CNBC.

## Should I Cash-In my Life Insurance (How CNN Got it Wrong and Why you should Care)?

Recently I cam across an article on the CNN Money Help Board posted from someone who was looking for some advice on deciding what to do with two life insurance policies he and his wife had.  The central sticking point for the individual was that the kids were gone and now he was trying to decide if it made sense to keep the life insurance policies he and his wife had.

Here's the Article

## The Many Handy Uses of Term Insurance

Some people may assume that insurance agents like me despise term insurance.  Look at it and wince with a large degree of disgust.

Nope.

## Moderation

I wanted to take a moment this week to temper things a bit and remind everyone that the Insurance Pro Blog is not an appendage of the Bank on Yourself or Be Your Own Banker folks.  We aren't affiliated and our name nor the Salus Agency (the agency that I own) will show up in any request more information query from Yellen's or Nash's web site.  Though we could be described as people with similar focuses, I happen to be a practitioner, while the other two consider themselves merely educators who sell a sales system to insurance agents.  On top of this, I don't believe that stocks and mutual funds have no place in your financial lives, I just believe the amount of these products that is necessary to lead a happy, financially healthy life, is grossly overstated.

## Buy Term and Invest the Difference?

You didn't think we'd pass on a chance to tackle this mammoth of the financial planning world did you?  A hotly debated notion for years and years pioneered by a guy who started a company to hawk term insurance under a simplistic mantra that appealed to the common folk that was later picked up by every stock broker and “financial expert” that had something to sell that wasn't life insurance.

So are we readying our spread sheets and insurance illustration software to blow the friable theory of decreasing responsibility asunder?  Hardly, we talk about insurance all the time, the last thing we need is to make this place any more boring–besides, we know the numbers work in our favor, that's why none of us are really afraid of the termites.  If mountaints of numbers and methodology are your thing drop us a line and we'll discuss it in detail.  Depending on the feedback, we might go real pro and dedicate a blog post to it–an extra special treat for the holidays.

Why then are we going to waste your time with a silly post about one of the most giggle-inducing “theories” of modern personal finance?  Because believe it or not BTID is a topic I find remarkable fascinating.  Not because I'm an infatuated practitioner (not even close) but because it's a great example of how in marketing, you don't have to tell the truth, you just can't flat out lie.

## The Kids…

Since we completely ignored the fact that there was a Holiday earlier this week, we'll take a minute to wish everyone a belated Happy Halloween (it's even more embarrassing that the last article to drop came out on 10/31).  Unless you the one around the office who spends an hour or more before work dolling yourself up for the Halloween customs you planned out almost a year in advance, you're biggest memory from earlier this week was likely taking your kids for an after-dark walk around the neighborhood to beg your neighbors for candy that would keep the kids up all night.  And since we're already on the topic of children, we figured today would be a great day to talk about the kids and buying life insurance for them.  Nothing scary or controversial there.  😉

So this topic has been debated (somewhat passionately) for years.  Some argue forcefully in favor others argue forcefully against it.  The traditional naysayers suggest that it's sick to purchase life insurance on your children as the thought of “profiting off their death” is sickening.  Still others like to point out that since you don't typically rely on your children as a source of income, it would appear meaningless to purchase life insurance on them.  Are they right?  Is a life insurance policy on your children just a good ruse devised by an insurance agent who came up with a way to boost his case count and make a quick extra buck here and there?  I actually used to sort of think so (gasp!).  But then something happened that made me change my mind.